MINNETONKA Minn. Famous Dave’s of America Inc. said Friday it has submitted a $5 million bid to acquire nine franchised locations owned by North Country BBQ Ventures LLC, which has filed for Chapter 11 bankruptcy protection.
As the “stalking horse” bidder, or the buyer that typically has been selected by the seller and places the first bid, thereby setting the lowest auction price, Famous Dave’s still needs to garner bankruptcy court approval and win a subsequent auction for it to gain the assets.
The nine locations are owned and operated by North Country, which is based in New Providence, N.J., and is one of Famous Dave’s largest franchisees. Its locations are based in New Jersey, New Hampshire and New York, and the company’s bankruptcy will be dealt with in the U.S. Bankruptcy Court for the District of New Jersey. At the end of September, the Famous Dave’s system consisted of 45 corporate locations and 132 franchised units throughout 37 states.
Christopher O’Donnell, chief executive officer of Minneapolis-based Famous Dave’s, said in a statement that the company owed its shareholders a hard look at this deal.
“The operations at these restaurants are good, and they have a loyal base of guests that love our concept,” he said. “We want Famous Dave’s to continue to thrive and grow in this region, and believe that if we are the successful bidder, our purchase of these assets, at an appropriate price would represent a terrific opportunity to perpetuate our brand and deliver shareholder value.”
The company said the purchase of these restaurants could add more than $20 million in top-line sales and contribute to “improved profitability.”
The agreement, which is expected to close during the first quarter of 2010, does not require that Famous Dave’s assume North Country’s liabilities.
Contact Sarah Lockyer at [email protected].